WASHINGTON (05/30/2000) - Taking reverse auctions one step further, the U.S.
Army's Communications-Electronics Command has tested online procurement software that searches for more information and performs an analysis of the seller.
Cecom, Fort Monmouth, New Jersey, announced May 25 that it had tested the reverse auction process, in which contractors jockeyed to provide the lowest price. The test included the online purchase of two items: a fax machine and a laptop computer.
Up to now, other military organizations have conducted reverse auctions online with price as the only factor. But Cecom used software from Frictionless Commerce Inc. that selects the seller with the lowest price and then searches the World Wide Web to locate similar requirements, ensuring that volume discounts are applied to the final purchase price.
Furthermore, the software has a built-in value analysis capability that analyzes the sellers, their prices, their performance and their compliance with previous contractual agreements, such as differing capabilities for varying brands of equipment, said Tom Clarkson, Cecom spokesman.
The online auction resulted in an approximate 50 percent savings, Clarkson added.